The Hindu Business Line : VSNL, ICICI Bank big losers; Patni recovers on buyback plans

The US stocks failed to hold on to the recent weekly gains as service industries contracted at the fastest pace since 2001. Besides, fears of more defaults from banks dragged the US markets for the first time in three weeks into the red.

Last week, the S&P 500 dropped 4.6 per cent to 1,331.29, the Dow Jones Industrial Average 4.4 per cent to 12,182.13 while the tech-focussed Nasdaq Composite declined 4.5 per cent to 2,304.85.

The domestic markets also witnessed similar fate. For a fourth week in a row, both the BSE Sensex and the NSE’s S&P CNX Nifty fell on reports of fall in GDP growth, rising inflation, weak global cues and continuous exit of foreign institutional investors. The Sensex fell 4.26 per cent while Nifty by 3.70 per cent

It was across-the-board fall for the Indian counters.

The only counter to finish in the green was Patni Computers following its buy-back proposals. The ADR closed at $13.84 against the previous week close of $13.45 The company’s board approved a buyback of equity shares from open market through stock exchanges in India at a maximum price of Rs 325 per share for an aggregate amount of Rs 237 crore. The stock ended at Rs 273.15 (Rs 257.05) on the BSE.

Though the IT other counters closed the week on a weak note, they recovered sharply from intra-week low levels following the robust financial performance of for IT major Cognizant Technologies. Revenues for the quarter grew 41 per cent compared with the same period last year following strong demand in the banking financial services and insurance (BFSI) segment, said Cognizant.

Infy closed the week at $41.7 ($43.5), Wipro at $11.79 ($12.64) and Satyam at $25.25 ($25.81).

Biggest losers

The biggest loser for the week was VSNL, whose ADR crashed by 14.3 per cent to $22.72 ($26.5). It was followed by ICICI Bank, whose ADR fell 11.2 per cent to $55.28 ($62.26). The other banking major HDFC Bank fell 7.9 per cent at $ 111.44 ($121) in sync with global market conditions against banking stocks.

Sterlite Industries fell 9.2 per cent at $19.44 ($21.4) and Tata Motors 7.4 per cent at $18.28 ($19.75).

Internet counters Sify and Rediff.com also tumbled by 7 per cent and 7.6 per cent respectively.

Premium/discount for the ADRs with respect to the BSE close almost remained the same. Among them, The Satyam Computer ADR was trading at a premium of 22.05 per cent (20.64 per cent) – the highest among listed ADRs.

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